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Benefits of price action trading

Get to know all about the best strategy in trading - Price Action.

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Benefits of price action trading

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  1. Benefits of price action trading

  2. When you are looking at the share price of a certain company, you are most likely to look at the fundamentals of the company. This would include financial indicators like revenue, profits, earnings per share and overall balance sheet health. Additionally, you would also look at some other macroeconomic factors like the political and economic situation of the country, the latest trends of the industry in which that company operates, and other such factors. The other way of assessing the likely movement of share prices is to look only at historical levels of the prices of those shares. This is called price action. Expressed in another way, it can be said that the process shifts from an economical and financial one to a purely mathematical one. Therefore things like trend lines, price bands, historical highs, past week lows and other such mathematical indicators are used in price action analysis.

  3. There are certain steps involved in a price action analysis. First, certain scenarios like bull runs and bear phases are to be recognized. So whatever the macroeconomic scenario, the share price of a particular share is likely to start dipping if it has enjoyed a bull run for long. Second, traders can set themselves a maximum profit-loss limit. So irrespective of the overall scenario, once a particular stock has given more than 10% profits (or losses) to the trader, he would sell them off. There are several benefits of price action trading, as any good price action trading course will tell you. If you are looking to make some short term or immediate gains, then price action analysis would serve you better. If you are able to combine your technical analysis of a particular stock with the price action analysis, you are likely to get the best possible prediction of which way the price is expected to move, and you can make adjustments accordingly.

  4. www.mithunsmoneymarket.com Call us at +971-503022789 (Dubai) | +91-9037034567 (India) Mail us @ info@mithunsmoneymarket.com

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